THE AAII JOURNAL MAY 2018 ISSUE

COVER ARTICLE

The Basics of Real Estate Investment Trusts (REITs)

These investment trusts provide direct exposure to real estate and are required to distribute at least 90% of their taxable income.

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Features

in Computerized Investing,Advisers

Trading Fractional Shares With Broker-Robo Hybrid Folio Investing

By Jaclyn N. McClellan

Folio Investing is a unique brokerage-robo adviser hybrid that allows users to invest in portfolios of stocks, ETFs and mutual funds that they can trade in a single transaction.

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in Computerized Investing

Learning About Real Estate Investing With BiggerPockets

By Jaclyn N. McClellan

Real estate investors can gain knowledge and skills, as well as share tips and interact with other investors, at the BiggerPockets website.

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in Portfolio Strategies

A Look Back at History: Lessons From the Financial Crisis

By Julie Jason

Three columns that provide a flashback to the last bear market and contain lessons that are still very valid today.

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in Bonds,Interest Rates

Bond Convexity: What Is It, and Why Should You Care?

By Brian Haughey

A bond’s price rises at an increasing rate as its yield falls, but its price falls at a decreasing rate as its yield increases.

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in AAII InvestoGraphic

Micro-Cap Stocks Outperform, Often in Consecutive Years

By AAII Staff

Micro-cap stock returns tend to be streaky, often showing outperformance for two or more years at a time.

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in AAII Model Portfolios,Small Cap Value Investing

Model Shadow Stock Portfolio: Staying Invested All 12 Months

By John Bajkowski

Staying invested in all 12 months of the year is important since missing the best single month dramatically lowers returns.

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in Portfolio Strategies

Picking a Rate of Return to Use for Long-Term Planning

By Charles Rotblut

A review of the historical data shows why long-term investors should look to long-term averages when setting return expectations.

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in Growth Investing,AAII Stock Ideas

Searching for Future Stock Market Winners

By Wayne A. Thorp

A study of past big winners identified common traits centered around value, earnings growth and price momentum.

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in Portfolio Strategies

The Impact of Saving Versus Return on Wealth

By Craig Israelsen

Younger savers benefit more from seeking higher returns, while older investors benefit more from increasing their savings rates.

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Notes & Opinions

in Editor's Note

Editor's Note

By Charles Rotblut

In this month’s issue, we are starting a series of periodic articles about real estate investment trusts (REITs). These trusts, as the name implies, invest in real estate, and they can be a good long-term diversifier.

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in Dispatches

Burden of Proof Is on Taxpayer When Documentation Is Missing

The Tax Court ruled in favor of a taxpayer who lacked documentation for, but was able to provide evidence supporting, his assertion about the timing and amount of an IRA contribution.

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in Dispatches

Cognitive Impairment Decreases Wealth

By AAII Staff

Households incur a greater loss of wealth when the person in charge of making financial decisions incurs a decline in their cognitive abilities.

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in Dispatches

Financial Documents to Keep and Shred

The IRS requires taxpayers to document most claimed sources of income, losses and deductions. This can create confusion over which financial documents need to be kept and which can be destroyed.

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in Dispatches

What Studies Say About How Oil Affects Stock Prices

Researchers have been trying to determine whether or not oil prices are linked to stock returns. To sum up the findings, two Australian researchers analyzed more than 100 studies from highly ranked journals.

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in Letters to the Editor

Letters

By AAII Staff

Members share their attitudes toward spending in retirement and comment on tax reform strategies and bitcoin blockchains.

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Expand to Read More

The AAII Journal, a leading investment publication, provides readers with a continuing stream of insights and ideas that focus on how you can improve your investment results. Unlike many investment magazines, ours is completely unbiased, educational and contains no advertising.

AAII has published this prestigious financial journal every month for more than 40 years. Members receive it for free and have access to thousands of evergreen articles online so they can reference information and strategies for previous market situations with a few clicks of the mouse.

Our stock journal helps individual investors manage their portfolios, build sound investment strategies and navigate all types of financial conditions. Articles range from optimizing target-date fund portfolios to retirement account withdrawal strategies and analysis on robo-advisor performance.

The magazine also has recurring features our members find invaluable. Every quarter, we dissect our model stock portfolio and provide updates to its holdings and performance. This analysis helps individual investors manage small-cap value investments.

We also offer an annual tax guide in our financial magazine. This detailed investment magazine issue covers many details that individual investors need to consider when filing their taxes. It keeps readers updated on any recent changes to tax laws and provisions and provides a handy guide to tax implications of personal investments to cut through any tax filing confusion.

Another annual feature covers ETFs (exchange-traded funds) and mutual funds. This edition helps individual investors understand what to look for when investing in funds. Online, we accompany those articles with sortable tables so that members have an interactive component to their investment research. This helps individual investors plan their portfolios and invest with confidence.

Other regular features in the AAII Journal include financial planning, stock ideas and investor professor. Financial planning articles walk investors through the process and difficulties of crafting strategies for creating wealth regardless of age. They also cover difficult situations, such as estate planning, and helpful advice for getting kids and grandchildren interested in investing.

Stock ideas, as the name implies, give readers a peek at new screens and the stocks that pass them. This part of our investing magazine helps readers identify new opportunities in the markets, flagged by a mix of quantitative and qualitative analysis. Because we all, as investors, need ideas, this remains one of the most popular categories.

Investor professor helps readers invest with knowledge and confidence. It deals with contingencies, such as “What happens to your investment if a company goes bankrupt?” and gives actionable advice on what resources you should use when considering a new broker. Our readers enjoy this section because of its practicality and enduring tips.

Frequent internal contributors include president John Bajkowski; AAII Journal editor and vice president Charles Rotblut; Stock Superstars Report lead analyst Wayne A. Thorp; and Dividend Investing editor Derek Hageman. Together, these internal contributors have nearly a century of market wisdom and research, which they share with clear and concise prose to help individual investors improve their knowledge and portfolios.

The AAII Journal also includes frequent guest contributions from the financial and economic space. Articles from outside industry experts differentiate our financial magazine from others and provide additional points of view for our readers. Previous guest authors have included John C. Bogle, founder of Vanguard; Jay Clayton, chairman of the U.S. Securities and Exchange Commission; Charles Schwab; and Nobel laureate and Yale professor Robert Shiller.

We hope you’ll enjoy our articles and, if you’re not a member, consider joining the Association so you can get our prestigious magazine sent to your door every month.